34 | BUSINESS JUSTICE | Treasury awaiting direction from office of the Attorney-General Kenya’s property at risk of sale over Sh1bn Anglo Leasing debt Swiss company had given the country until Monday to settle the dues BY CHARLES WOKABI cwokabi@ke.nationmedia.com AND MUTHOKI MUMO mumumo@ke.nationmedia.com K enya’s property abroad risks being auctioned as the Treasury awaits guidance from the AttorneyGeneral on payment of Anglo Leasing debts. The government had been given until Monday to pay Sh924 million ($10.6 million) to First Mercantile Securities Corporation following a December 2012 judgement in a Swiss court. Failure to clear The firm’s lawyers, Tavers Smith, had warned that failure to clear the debt could precipitate proceedings to enforce the judgement in England. Essentially, this means that Kenya’s properties abroad could be attached and auctioned. However, Treasury Cabinet Secretary Henry Rotich said yesterday he had referred the matter to the State Law Office and was awaiting guidance. “The important thing is FILE | NATION Treasury Cabinet Secretary Henry Rotich at a previous event. that settling these debts can be a three month process. The A-G is going to advise us on how to manage the settlement to ensure that it works,” said Mr Rotich. He said First Mercantile was yet to attach any of Kenya’s properties abroad. 2012 The year in December when the judgment was entered BY NATION REPORTER Kenya has signed a deal that is expected to cushion local financial institutions as they lend at least Sh4.3 billion ($50 million) to smallholder farmers over the next three years. The Sh860 million ($10 million) Officials from the State Law office had not responded to calls from the Daily Nation for comment by the time of going to press advising reporters to contact the A-G’s office today at 9 am. In the letter to the National Treasury and Attorney-General Githu Muigai, First Mercantile threatened to “take steps with a view to commencing enforcement proceedings in England to recover the judgment debt and any related costs.” “Despite repeated demands for payment, the judgment debt remains unpaid. Interest on the judgment continues to accrue,” the letter dated March 5. Significantly higher It is feared that what is due could be significantly higher than $10.6 million given that the government is charged an interest of $1,400 (Sh126,000) daily for failing to pay. “We understand that First Mercantile’s Kenyan advocates, A. H. Malik & Co, have previously written to the Republic of Kenya in relation to the non-payment of the debt but that the Republic of Kenya has neither responded to that correspondence nor paid the debt to First Mercantile,” reads a letter. Mr Rotich had told the Nation that money to settle the debts would be factored in the second supplementary budget estimates expected in parliament in May. The A-G is going to advise us on how to manage the settlement process to ensure that it works,” Mr Rotich Anglo Leasing remains one of the biggest scandals in Kenya and has cost taxpayers billions of shillings paying for goods that were never delivered. The government had prom- ised to ensure no tax-payers’ money would be lost in the scam but efforts to appeal against the judgment have borne no fruit. Mr Rotich now hopes parliament approves his request to be allocated money to settle the debt alongside another one owed to Universal Satspace Company. Treasury signs deal to extend credit to farmers risk sharing facility extended by the Treasury in partnership with the International Fund for Agricultural Development, is expected provide cheaper credit to at least 700,000 Kenyans. Under the agreement, the Co-operative Bank of Kenya, K-Rep Bank, Barclays Bank of Kenya and the Agricultural Finance Corporation are targeting to extend loans of up to Sh8.6 billion ($100 million) at rates of between 10 per cent and 15 per cent. The fund will be managed by the Alliance for a Green Revolution in Africa which has experience working on similar facilities. “If the banks incur any losses in lending to the sector, they will be compensated from the fund. The element of sharing the risk is supposed to make agricultural finance more accessible,” said Alliance Kenya country leader, Mr Nixon Bugo. DAILY NATION Wednesday March 26, 2014 RECIPE FOR HUNGER Inadequate maize seed supply to affect harvests, warns institute. Page38 BRIEFLY INSURANCE Insurer to invest Sh300m in Malawi CIC Insurance Group will in- vest Sh300 million in Malawi’s national cooperatives to increase its regional business. In a deal signed yesterday, the insurer and Malawi Union of Savings and Credit Co-operatives Ltd will own 49 per cent shares each in a new CIC subsidiary. This will give CIC Group access to Malawi’s co-operative movement comprising 45 savings and credit unions. “The potential for growth in the co-operative movement in Malawi is enormous and services like sacco insurance will be a catalyst for the growth,” said chief executive Nelson Kuria. SURVEY Why firms are losing their top employees Kenyan employers are fast los- ing their workers to other firms due to job insecurity, flexibility and career advancement, according to a study released yesterday. The Jobseekers Survey 2014 reveals that 66.5 per cent of staff in the city will migrate this year seeking higher pay, a better working environment and good terms of services that reflect their skills. “Employees have also raised their expectations which current employers are not meeting and hope the next would,” said Corporate Staffing Services managing director Perminus Wainaina. TELCOMS Airtel names new head of Kenyan unit Airtel Kenya has appointed Adil El Youssefi as its new managing director replacing Shivan Bhargava who has been at the helm of the company since 2012. Mr Adil joins the mobile phone firm from Ghana-based Millicom Group where he has been the general manager since June 2012. He joined the group in 2008 as senior advisor to the chief officer, Asia in Sri Lanka. In 2009, he joined the group in Chad as deputy general manager and was appointed general manager a year later.